The Demand for Residential Electricity in Nigeria

This paper examines the residential demand for electricity in Nigeria as a function of real gross domestic product per capita, price of electricity, and price of a substitute between 1970 to 2007. The bounds testing approach used to cointegration within an autoregressive distributed framework, suggested by Pesaran et al. (2001). In the long run, we found that income and the price of substitute emerges as the main determinant of electricity demand in Nigeria, while electricity price is insignificant. The relationship among the variables is stable and significant.